Life Insurance Council pushes regulator for 50% concession in re-insurance rate

  

Life Insurance Council has urged the regulator for 50% concession in re-insurance rate on Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), on account that its members face losses as the premium may not be sufficient to cover the cost. 

 

The council is also in the verge of  approaching the  states to waive stamp duty of $40 for improving the  viability of the scheme. Recently, out of 24 life insurance companies, 10 have joined the national programme, offering Rs.2 lakh sum assured in case of death of a policy holder on an annual premium of just Rs.350.

 

Insurance companies will get just about Rs.249 after deducting towards bank commission and stamp duty, which many believe is not going to cover the cost of insurance.

 

Banks that are mandated to sell the social security scheme have sold 2.5 crore life insurance policies since May Insurers will have to pay Rs.100 crore as stamp duty collectively.

 

Insurers have also expressed concerns over duplication of death claims and the council has engaged Credit Information Bureau (India) Ltd or Cibil to detect them. Cibil has built a database of 40 crore bank customers and 2.3 crore commercial loans, beside repository data of one crore mortgages. 

 

Life Insurance Council has urged the regulator for 50% concession in re-insurance rate on Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY), on account that its members face losses as the premium may not be sufficient to cover the cost. 

 

The council is also in the verge of  approaching the  states to waive stamp duty of $40 for improving the  viability of the scheme. Recently, out of 24 life insurance companies, 10 have joined the national programme, offering Rs.2 lakh sum assured in case of death of a policy holder on an annual premium of just Rs.350.

 

Insurance companies will get just about Rs.249 after deducting towards bank commission and stamp duty, which many believe is not going to cover the cost of insurance.

 

Banks that are mandated to sell the social security scheme have sold 2.5 crore life insurance policies since May Insurers will have to pay Rs.100 crore as stamp duty collectively.

 

Insurers have also expressed concerns over duplication of death claims and the council has engaged Credit Information Bureau (India) Ltd or Cibil to detect them. Cibil has built a database of 40 crore bank customers and 2.3 crore commercial loans, beside repository data of one crore mortgages.